from the sorry,-nobody-believes-you dept

As we've been warning for a while, the next phase in the war on net neutrality for giant ISPs is pushing a new "net neutrality law" in name only. ISPs are nervous that the FCC's net neutrality repeal won't survive a court challenge due to the numerous instances of fraud and other procedural gaffes. As such, they've convinced blindly-loyal lawmakers like Marsha Blackburn to push fake net neutrality legislation whose entire purpose is to prevent the FCC's 2015 rules from being restored, or real, tough rules from being passed later.

These proposed "solutions" ban behaviors ISPs had no intention of doing (like the ham-fisted blocking of websites), but avoid addressing any of the numerous areas where net neutrality violations now occur, from usage caps, overage fees and zero rating, to interconnection shenanigans designed to drive up costs for streaming video competitors like Netflix. But with Democrats hoping to use net neutrality as a wedge issue in the coming midterms (and pushing for a repeal reversal via the CRA), these bogus solutions haven't seen much traction outside of paid editorial support by telecom lobbyists.

Enter AT&T, who this week bought full-page ad space in the New York Times and Washington Post to publish this love letter from AT&T CEO Randal Stephenson to American consumers. In it, Stephenson proclaims that despite having spent millions trying to gut consumer protections of every color, the company is a breathless advocate for the "open internet," and is really eager to lead the charge for "new laws that govern the internet and protect consumers":

"But the commitment of one company is not enough. Congressional action is needed to establish an “Internet Bill of Rights” that applies to all internet companies and guarantees neutrality, transparency, openness, non-discrimination and privacy protection for all internet users. Legislation would not only ensure consumers’ rights are protected, but it would provide consistent rules of the road for all internet companies across all websites, content, devices and applications. In the very near future, technological advances like self-driving cars, remote surgery and augmented reality will demand even greater performance from the internet. Without predictable rules for how the internet works, it will be difficult to meet the demands of these new technology advances.

Of course if you've been following along at home, AT&T is the very last company that should be giving advice on any of these subjects. In recent years, AT&T has been fined $18.6 million for helping to rip off programs for the hearing impaired; $10.4 million for ripping off programs for low-income families; $105 million for helping "crammers" rip off its customers by making bills intentionally harder to understand, and for playing a starring role in gutting both net neutrality and broadband privacy protections.

AT&T's also repeatedly violated net neutrality and consumer privacy, whether that entailed blocking FaceTime to drive wireless users to more expensive options, or exempting its own content from usage caps to give itself an unfair advantage in the market. And who could forget that time that AT&T was caught alongside Verizon covertly modifying user packets to track people around the internet without their knowledge? AT&T's also smack dab in the middle of an effort to gut FCC, FTC and state authority over broadband providers.

Again, AT&T's actual goal here is three-fold. One, get a shitty, loophole-filled net neutrality law on the books that would pre-empt efforts to restore the FCC's 2015 rules or any Congressional or FCC attempt to pass real, tough rules down the line. Two, get a shitty net neutrality law on the books to supplant state efforts to protect net neutrality in the wake of AT&T-lobbied federal apathy. Three, impose new regulation on the likes of Google and Facebook as it attempts to buy Time Warner for $86 billion and jump into the Millennial advertising race.

AT&T has long complained that net neutrality and privacy rules applied to its broadband businesses aren't fair because the same, exact rules aren't being applied to the likes of Google and Facebook. But that argument ignores the fact that broadband is a uniquely broken market, where consumers often don't have the choice of numerous ISPs. Net neutrality violations were just a symptom of limited competition, and net neutrality rules were a temporary band aid until somebody in government grows a spine and embraces policies that drive actual competition. AT&T, as you might have noticed, wants neither competition nor real oversight.

“It would be a lot easier to take AT&T at their word if they hadn't spent more than $16 million last year alone lobbying to kill net neutrality and privacy protections for Internet users,” said Evan Greer, an activist with the pro-net neutrality group Fight for the Future. “Internet activists have been warning for months that the big ISPs plan has always been to gut the rules at the FCC and then use the 'crisis' they created to ram through bad legislation in the name of 'saving' net neutrality."

Keep in mind, Blackburn's fake net neutrality law is likely just the first of many shitty legislative proposals you'll see pushed by the mega-ISPs as they grow increasingly nervous the FCC's ham-fisted repeal won't survive court challenge. But you'll be hard pressed to get AT&T to actually sign off on a net neutrality law that actually does much of anything useful, and net neutrality supporters will need to tread carefully before throwing their support behind "solutions" to problems the ISPs themselves created.

from the evidence-schmevidence dept

Last week we noted how AT&T was forced to scrap a partnership with Huawei to sell the company's smartphones here in the States, just hours before it was set to be announced at CES. The reason? Apparently a few members of the Senate and House Intelligence Committees fired off a letter to the FCC demanding that they pressure US telcos into avoiding Huawei. The letter, which nobody has published, allegedly accuses the company of being little more than an intelligence proxy for the Chinese government.

There are several problems with this. While it's certainly possible that Huawei helps the Chinese government spy, there's been no hard evidence of this. In fact, numerous investigations (including one eighteen months long) found no evidence of any spying whatsoever. What inquiries did find is that these allegations pretty consistently originate with U.S. hardware vendors like Cisco, who routinely enjoy playing up the threat simply because they don't want to compete with Chinese hardware vendors. You know, the very same thing we routinely (often quite accurately) complain about China doing.

Despite no real evidence, a new Reuters report indicates this new pressure is much greater than just AT&T's smartphone partnership. In fact, the report suggests that the government is now urging all US telcos and ISPs to avoid using any Huawei gear whatsoever if they want to continue winning government contracts (and as an NSA BFF, AT&T has plenty of contracts to protect). From the report:

"The lawmakers are also advising U.S. firms that if they have ties to Huawei or China Mobile, it could hamper their ability to do business with the U.S. government, one aide said, requesting anonymity because they were not authorized to speak publicly.

One of the commercial ties senators and House members want AT&T to cut is its collaboration with Huawei over standards for the high-speed next generation 5G network, the aides said. Another is the use of Huawei handsets by AT&T’s discount subsidiary Cricket, the aides said.

And while Reuters mentioned that there have been investigations, it oddly forgets to mention what the outcome of those investigations were (again, zero evidence of spying). Also ignored is the fact that Chinese networking hardware is absolutely everywhere in the States, including being embedded in many of the products sold by U.S. manufacturers. If China wants to spy on America, it only need turn to the ocean of poorly secured IOT devices, the lion's share of which are now made in China by companies with a complete and total disinterest in anything even vaguely resembling security standards.

Similarly and comedically ignored is the fact the United States government engages in this kind of behavior all of the time. You might recal the NSA was caught intercepting Cisco hardware to install surveillance technology a few years ago. The Snowden documents also revealed how the NSA hacked into Huawei and stole company source code as early as 2007, all in the hopes of planting backdoors in network hardware used by countries who avoid buying American gear. Everyone but the most ardently myopic patriots realize that the United States' credibility on this subject was dismantled decades ago.

This latest wave of hysteria comes simultaneously and not-coincidentally as Representatives Michael Conaway and Liz Cheney introduced a bill banning US carriers from doing any business whatsoever with Huawei or ZTE Corp (two guesses on which companies are pushing for that law). Again, it's perfectly possible that Huawei helps the Chinese government spy. But if that's the case, it shouldn't be too difficult to provide some hard evidence supporting this position. Unless, of course, this is all little more than an adorable little stage play concocted simply to protect US hardware vendors from having to actually compete.

from the in-your-face dept

If you listen to Comcast , AT&T, Verizon and their army of paid allies, nothing bad will happen now that the FCC has voted to kill net neutrality protections. In fact, Comcast argues, without government oversight of an uncompetitive market, investment and jobs will soon be miraculously springing forth from the sidewalks. It will, the industry argues, be impossible to even measure the incredible innovation that will be created by letting entrenched ISPs (and their natural monopoly over the broadband last mile) run roughshod over the backs of American consumers and smaller competitors.

But even among folks that support net neutrality, there's pretty clearly a contingent that still believes the damage caused by the repeal of the rules will somehow be subtle. Because the net neutrality debate in recent years wandered into more nuanced and quirky areas like interconnection and zero rating, they believe the ultimate impact of the repeal will likely be modest. After all, these harms (like Comcast exempting its own content from usage caps, or Verizon covertly choking interconnection points) were murky and out of the intellectual or technical reach of many Luddite consumers.

The good folks at Boing Boing, for example, warn readers that the impact of the death of net neutrality will somehow be "hard to spot." Julian Sanchez similarly shared his concerns that net neutrality advocates are harming the overall goal of the movement by warning of dire outcomes in the years to come. Actual harms, Sanchez insists, will be "pretty much invisible":

I suspect the doomsday approach to net neutrality is going to backfire badly. Because if the sophisticated neutrality arguments are right, the actual harms are all going to be pretty much invisible to the end user. The visible effects will be stuff people like.

Of course most of the folks that really understand net neutrality have acknowledged that the harms initially may be muted. ISPs will initially want to be on their best behavior in the new year as they wait for the inevitable lawsuits against the FCC (for ignoring the public and ignoring rampant comment fraud) to shake out, wary of providing the ongoing proceedings with any ammunition. And, as we've noted, ISPs are well aware that even then the rules could simply be recrafted at a later date, which is why they're pushing for a fake net neutrality law that makes federal apathy on the subject the law of the land.

But should ISPs win in the courts or on the Hill, the end result of what they're trying to accomplish will be anything but subtle. Anybody believing otherwise doesn't understand the full scope of what ISPs lobbyists are (so far successfully) up to here.

That's because the FCC didn't just repeal net neutrality. The repeal of the neutrality rules is, in fact, just one part of a much larger vision the ISPs have been lobbying for for years. And that vision includes gutting FCC oversight of broadband ISPs entirely, then shoveling any remaining oversight to an FTC whose authority over ISPs is currently being challenged in court and may soon be all but worthless. With federal oversight out of the way, ISPs have also successfully lobbied the FCC to pre-empt any states that get the crazy idea of protecting consumers from these regional telecom mono/duopolies.

Subtle, nuanced violations of net neutrality (like zero rating) were the end result of fairly tepid, inconsistent regulatory oversight of administrations' past. But what we're talking about here is the wholesale dismantling of adult regulatory oversight of some of the least-liked, least-competitive companies currently operating in America. Anybody that has studied history (or watched Comcast and AT&T do business) and still thinks the resulting harms will be subtle once adult supervision leaves the building simply doesn't understand the full scale of what's being attempted here.

As such, "net neutrality violations" will only be a small part of the problem. Net neutrality infractions are just a symptom of a lack of competition. They're just "creative" efforts to abuse a lack of competition. With neither oversight nor competition, there's no longer a need to be creative or measured. And the impact will be a diverse array of compounded problems, including higher prices, expanded and tightening usage caps and overage fees, even worse customer support (if that's possible for the telecom sector) and even greater privacy abuses than we've grown accostomed to.

Should Comcast, AT&T and Verizon successfully win in court and make the repeal permanent, all bets are off. History tells us repeatedly that the one-two punch of regulatory capture and limited competition has very real, very obvious harms. With no rules and little to no real oversight, there will no need for the pretense we saw as ISPs attempted to creatively tap-dance around the FCC's modest 2015 rules. If you think these companies will be reasonable and measured when they finally receive the green light, you may soon get a very intimate lesson in regulatory capture and natural monopolies.

That said, there remain reasons for hope. The FCC engaged in so much bizarre behavior, made so many procedural gaffes and leaned so heavily on bogus data that the repeal has a good shot at being overturned in the courts. And the subsequent efforts to have ISP cronies in Congress pass bogus net neutrality rules appear to be facing too much justifiable skepticism to gain much traction (though this effort will see a renewed push with multiple legislative efforts -- and lots of phony, farmed support -- in the new year). With a little luck and some elbow grease, the doomsday scenarios quite correctly being predicted may still not come to pass.

from the the-best-laws-money-can-buy dept

As we just got done saying, giant ISPs are well aware that last week's unpopular FCC vote to repeal net neutrality rests on very shaky legal ground. The agency will be facing all manner of lawsuits in the new year from competitors and consumer groups that quite correctly highlight the blatant fraud and bizarre missteps that occurred during the proceeding. Those lawsuits will also argue that the FCC is violating the Administrative Procedure Act by passing a law without proving that the broadband market had changed enough in just two years to warrant such a severe, unpopular reversal (tip: it didn't).

As such, ISPs are already pushing hard to codify the FCC's idiotic and unpopular repeal into law. ISPs like Comcast are claiming they're just so interested in protecting the open internet (after spending millions to dismantle real net neutrality rules) that a law their lobbyists likely wrote is the only path forward now. But these bills have one purpose: to prevent any future FCCs or Congressional lawmakers from passing meaningful rules down the road.

Enter Tennessee Representative Marsha Blackburn, who has for years been a glorified rubber stamp for AT&T and Comcast, going so far as to support state-level laws that hamstring competition and erode local rights. Today Blackburn unveiled the "Open Internet Preservation Act" (pdf), which, as we predicted, bans things like outright throttling, but ignores numerous other possible avenues of abuse by ISPs, including zero rating, paid prioritzation, and interconnection shenanigans. The bill also tries to ban states from trying to protect net neutrality in the wake of federal apathy, another gem ISPs like Comcast have been coincidentally lobbying for the last few months.

"Rep. Blackburn told Breitbart News why she decided to unveil her legislation to codify the laws of a free and open Internet. She said, “When you talk to innovators in the online space, one of the things that is frustrating to them is that the rules of the internet continue to change over the last few years. What we want to do is codify the rules of an open internet."

“What we saw with the Wheeler order in 2015 was really control of the Internet. We are going to put rules in place that will stop the ping-ponging depending on who’s in charge of the FCC. This is an issue that should be decided by Congress,” Blackburn added.

Of course Blackburn would have you ignore the fact that her rhetoric almost exactly mirrors a blog post Comcast posted just a few days ago, or the fact that her bill was likely written by Comcast and AT&T lawyers and lobbyists. She'd also have you ignore that the "innovators" she pays lip service to strongly oppose the repeal of the current rules, as nearly 1000 startups made very clear back in April. Blackburn also took to Twitter to regurgitate numerous debunked industry canards, like the entirely bogus claim that net neutrality rules hurt sector investment:

Obamacare-era "net neutrality" is nothing more than a code word for government takeover of the internet. These regulations stifled internet investment and growth, and gave tech companies a free pass to censor users and block free speech.

Again, these folks couldn't give less of a damn about "protecting the open internet." They're solely looking out for the interests of AT&T, Verizon, Comcast and Charter. And what these ISPs want (and are in the process of getting) is a complete dismantling of both federal and state oversight of telecom duopolies so they can continue abusing the lack of competition in the sector for the foreseeable future. They know the FCC's repeal is in jeopardy of being overturned by the courts, so they're trying to rush through shitty legislation that effectively makes violating net neutrality legal.

It's likely this will be the first of several bills of this type, and the inclination on some fronts will be to suggest that "a bad bill is better than no protections at all." But that's a naive interpretation of what ISPs are attempting here. As we just noted, any ISP-supported net neutrality legislation will ban things ISPs never intended to do (like outright blocking of Netflix), but won't cover any of the more nuanced areas where net neutrality violations are now occurring (usage caps, zero rating, interconnection). Why rush to support a bill that simply acts to make most violations legal?

A better solution is to find away to keep the current rules intact. It's unlikely, but that could occur via use of the Congressional Review Act. Much more likely is the repeal being overturned by the courts, thanks to the FCC's apathy toward fraud and the public interest. Even if ISPs win in the courts, net neutrality fans are better off riding the looming backlash and using it to drive ISP-loyal sycophants out of public office at the polls, then attempting a real net neutrality law later -- when Congress is a little less mindlessly loyal to the desires of some of the least-liked, least-competitive companies in America.

from the yeah,-nice-try dept

AT&T is the latest big broadband player to try to suggest that everyone just calm down a little about this whole thing where the FCC destroys net neutrality. And, sure, some of the reports out there and some of the predictions being made about the impending death of net neutrality are fairly exaggerated. But, there are serious concerns, and AT&T's decision to set up some strawmen to knock over ignores the importance of the issue.

Also, while AT&T ignores this, let's bring up a bit of history. Because it was former AT&T CEO Ed Whitacre who kicked off much of this debate back in 2005 when he declared that he was going to start charging successful internet sites to reach "his" customers over "his" pipes:

"Now what they would like to do is use my pipes free, but I ain't going to let them do that because we have spent this capital and we have to have a return on it. So there's going to have to be some mechanism for these people who use these pipes to pay for the portion they're using. Why should they be allowed to use my pipes? The Internet can't be free in that sense, because we and the cable companies have made an investment and for a Google or Yahoo! or Vonage or anybody to expect to use these pipes [for] free is nuts!"

As we pointed out at the time, this statement is incredibly misleading. Everyone -- especially those companies -- pay for their own bandwidth. And when AT&T's customers connect to the internet, the reasons it's worth it to them to pay AT&T for internet access is because they can access the entire internet, and not just the parts that AT&T gets to charge companies double for.

So, with that in mind, let's take a look at the nonsense AT&T's top lobbyist, Bob Quinn, posted to AT&T's blog.

AT&T intends to operate its network the same way AT&T operates its network today: in an open and transparent manner. We will not block websites, we will not throttle or degrade internet traffic based on content, and we will not unfairly discriminate in our treatment of internet traffic (all consistent with the rules that were adopted – and that we supported – in 2010, and the rules in place today). These commitments are laid out in the broadband details section of AT&T’s main website. They represent a guarantee to our customers that we will provide service in an open and transparent way. They have been, and will continue to be, enforceable commitments. We will not remove that language and we will continue to update any changes we make to our network management practices. Those commitments are not new. They have been formally in place in one form or another at AT&T since 2005, and we have also publicly disclosed how we manage internet traffic with a version of our current broadband details description on our website since 2010.

If AT&T is making no changes and intends to operate the same way, why has AT&T been pushing so hard against the 2015 rules and for this repeal? And, again, it was the company's former CEO who made those statements above about how it's "nuts" that all these internet companies get to ride "his pipes... for free." Does that really sound like a company that has no intention of doing paid prioritization or fast lanes and slow lanes? Yes, Whitacre is no longer CEO, but the current CEO, Randall Stephenson, worked for Whitacre for many, many years and was his handpicked successor. So it's not as if AT&T has some new, more enlightened management.

What is different is that AT&T has learned that being so blatant and so upfront about their plan to screw over internet users and websites goes over poorly in the press. So they figured out a while back how to make the behavior sneakier. They can play around with interconnection. They can dabble in zero rating. And, as some will no doubt point out, the 2015 open internet order did not explicitly deal with either of these loopholes (which was one of our biggest complaints with the order). But it did signal an FCC that wouldn't allow such bad actions (which is why interconnection fights all disappeared almost within seconds of the order being approved).

In short: AT&T will seek to use whatever power it can to extract rents from the internet. Remember, this is a company that has been fined over and over and over again by the FCC for a variety of bad, anti-consumer behavior. And, remember, some of those fines (for SMS cramming) were under Title II. Do we magically think that AT&T is going to suddenly stop fucking over its users once the FCC has publicly stated "do whatever the fuck you want, we no longer care."

We not only have enforceable commitments on blocking, throttling and discrimination on our own network, we also have incentives to ensure that other ISPs adhere to these same open internet principles. Take, for example, DIRECTV NOW, our over-the-top video service that travels over broadband connections whether owned by AT&T or someone else. We depend on an open internet for this service, and we accordingly conduct ourselves – and will continue to conduct ourselves – in the same manner we expect to be treated when we rely on the infrastructure of others to provide services to our customers.

This sounds nice, doesn't it? Except, should we forget that the previous FCC actually found that AT&T abused its relationship with DirecTV in a way that violated its net neutrality rules? I mean, does Quinn just hope that people reading his blog post don't remember what happened less than a year ago?

Besides, AT&T knows damn well that, as large as it is, it can easily negotiate good terms for competitors to carry DirecTV Now, while at the same time it has the leverage to fuck over smaller competitors.

The day after the FCC’s decision, consumers are going to see no changes to how their internet works. Everyone will be able to access their favorite websites; no one’s traffic will be throttled based on content; and the consumer internet is going to work the same way it did the day before the FCC order is adopted.

Well, sure. The day after the FCC's decision nothing is going to change because AT&T knows that a bunch of lawsuits will be filed, and it's not stupid enough to do something so blatant that it will be used as fodder in that lawsuit. It'll wait. And if the rules are upheld, you'll then suddenly start to notice little changes here and there. And, frequently, they'll be couched and framed in ways to look supportive of the consumer, rather than anti-consumer. They'll be things like zero rating, where AT&T will pretend that it's giving you "free data" even though it's really only "free" from the arbitrarily low and onerous caps that it sets itself.

Consumers will, however, see enormous benefits from the FCC’s actions. Utility regulation over broadband can only inhibit incentives for network investment.

They keep saying this, but this is hogwash. Again, the net neutrality rules was not "utility regulation." It was a basic framework that said you can't fuck over users. It was only a burden if your intent was to fuck over users. So if AT&T claims it was a burden... it was because it intended to fuck over users.

By lifting that cloud here, the FCC will restore the bi-partisan, light-touch regulatory structure that made the United States the world leader in mobile broadband infrastructure.

Hogwash. This is the same AT&T that bid billions last year under Title II in the big FCC spectrum auction. If it really felt hamstrung over the rules, why would it have invested so much in that spectrum?

The doomsayers, of course, have a different view, conspicuously colored by a litany of hypotheticals and hyperbole, and generally devoid of facts. Some are calling this the death of the internet as we know it. The doomsayers, however, have been making these and similar dire predictions for years. In 2010, in response to the first FCC Open Internet rules, Free Press warned:

“These rules don’t do enough to stop the phone and cable companies from dividing the Internet into fast and slow lanes, and they fail to protect wireless users from discrimination. No longer can you get to the same Internet via your mobile device as you can via your laptop. The rules pave the way for AT&T to block your access to third-party applications and to require you to use its own preferred applications.”

Of course, none of those predictions ever came true then and they won’t come true after the FCC acts here either. There will be a lot of talk over the next two weeks on what the FCC’s net neutrality order means. The truth is that, at first, no one will notice a difference in how their internet works. But when the removal of utility regulation translates into greater broadband investment and increased innovation on the internet…well, everyone will eventually notice that.

Actually... the one who is "devoid of facts" here is Bob Quinn at AT&T. Because under those rules, what Free Press predicted did happen. Remember when AT&T blocked Google Hangouts on mobile? Or when it blocked Facetime? Both of those happened under the weak 2010 rules, just like Free Press predicted.

And, I should note, this seems like another reason not to trust AT&T here. It's directly denying it had done the very thing... it did. I know in this age of alternative facts some powerful folks believe that if you just say you didn't do the thing you absolutely did, many people will believe that you never actually did it. But the facts are here.

Furthermore, AT&T's statement is even more disingenuous, because the 2010 rules were fought over in court for many years, which again was a reason why AT&T and others didn't go all out in implementing really bad behavior, so as not to give an assist to the courts.

Either way, AT&T's statement is extremely misleading, ignores significant history from AT&T in both what its execs have said it intends to do and the company's actual actions. AT&T's Bob Quinn is spewing alternative facts here, and the public shouldn't accept his lies.

from the why-we-can't-have-nice-things dept

There's numerous methods incumbent ISPs use to keep broadband competition at bay, from buying protectionist state laws to a steady supply of revolving door regulators and lobbyists with a vested interest in protecting the status quo. This regulatory capture goes a long way toward explaining why Americans pay more money for slower broadband than most developed nations. Keeping this dysfunction intact despite a growing resentment from America's under-served and over-charged broadband consumers isn't easy, and has required decades of yeoman's work on the part of entrenched duopolies and their lobbyists.

Case in point: Google Fiber recently tried to build new fiber networks in a large number of cities like Nashville and Louisville, but ran face first into an antiquated utility pole attachment process. As it stands, when a new competitor tries to enter a market, it needs to contact each individual ISP to have them move their own utility pole gear. This convoluted and bureaucratic process can take months, and incumbent ISPs (which often own the poles in question) often slow things down even further by intentionally dragging their feet.

So in cities like Nashville and Louisville, Google Fiber and other competitors have pushed for so-called "one touch make ready" utility pole reform. These reforms let a licensed and insured contractor move any ISP's pole-mounted gear if necessary (usually a matter of inches), as long as the ISP is notified in advance and the contractor pays for any damages. Under these regulatory reforms, the pole attachment process can be reduced from six months or more to just a month or so -- dramatically speeding up fiber deployment. ISPs like Verizon (in part because Google Fiber isn't encroaching on their East Coast turf) have supported the changes.

But because this would accelerate competitor broadband deployments as well, incumbent ISPs like AT&T, Comcast and Charter Spectrum did what they do best: they filed nuisance lawsuits against both Nashville and Louisville -- claiming they'd exceeded their legal authority in updating the rules. The companies proclaim they're simply concerned about the potential damage to their lines (ignored is the fact that the contractors doing the work are often the same people employed by ISPs), but the lawsuits are driven by one thing: fear of competition.

In Louisville this tactic didn't work so well, with a Judge ruling that the city was perfectly within its legal rights to manage the city's utility poles. ISPs had claimed that these cities' authority was over-ridden by FCC rules, though even the FCC itself backed Google Fiber and the cities in this fight (obviously this position, like most pro-competitive policies, were reversed when Trump appointed Ajit Pai to head the FCC last fall).

"We're reviewing today's court ruling to understand its potential impact on our build in Nashville," a Google spokesperson said. "We have made significant progress with new innovative deployment techniques in some areas of the city, but access to poles remains an important issue where underground deployment is not a possibility."

There's several reasons Google Fiber announced last fall that it was pivoting toward wireless/fiber hybrid deployments. One was the high cost and slow pace of fiber deployment, but another was the kind of legal and regulatory roadblocks being erected by the likes of AT&T, Charter and Comcast, who are utterly terrified at the faintest specter of competition disrupting their all-too-cozy markets. Google Fiber has managed to avoid some of these obstacles via technologies like microtrenching, but the incumbent ISP goal of slowing the rise of competition has proven successful overall.

from the you're-not-helping dept

As the Trump administration guts oversight of some of the least liked and least competitive companies in America in one of the most brazen examples of crony capitalism in tech policy history, ISPs like Verizon and Comcast seem intent on insisting that none of this is actually happening. Verizon, you'll recall, went so far as to publish a comical video in which the company used a fake journalist to try and construct an alternate timeline; one in which Verizon hasn't been trying to undermine net neutrality and a healthy, competitive internet for the last fifteen years:

Comcast lobbyists and PR reps have also been having grand old time pretending that this blatant example of regulatory capture isn't real, and that the complete dismantling of telecom sector oversight won't have a decidedly-foul impact on already frustrated end users and the internet. The company has penned blog post after blog post stating that sure, the FCC may be gutting already flimsy oversight of one of the least competitive sectors in America, but users shouldn't worry because the company's tireless love of consumers will somehow carry the day:

"As we have said previously, this proposal is not the end of net neutrality rules. With the FCC transparency requirement and the restoration of the FTC‘s role in overseeing information services, the agencies together will have the authority to take action against any ISP which does not make its open Internet practices clearly known to consumers, and if needed enforce against any anti-competitive or deceptive practices. Comcast has already made net neutrality promises to our customers, and we will continue to follow those standards, regardless of the regulations in place."

That's the same, debunked bullshit Cohen has been peddling for years. While the FCC hasn't released its full rule-killing order as of this writing (it foolishly thought it could hide it behind the Thanksgiving holiday), folks I've spoken to who've seen the order say the remaining transparency requirements on ISPs are so loophole-filled as to be utterly useless. As such, Comcast is stating it will adhere to them happily -- since there won't be much of anything to actually adhere to. Yes, that's really impressive, David.

Meanwhile, reversing the classification of ISPs as common carriers under Title II of the Communications Act absolutely destroys the rules. You'll recall that when the FCC tried to impose rather flimsy net neutrality rules in 2010, the courts shot down that effort -- making it clear that for real net neutrality, you needed to return ISPs to their 2002-era classification as "telecommunications services." So that's what it did in 2015. Reverse that classification (again), and you've eroded the FCC's authority to police bad behavior by a sector with a rich history of anti-competitive behavior and predatory pricing.

As we've noted previously, the broadband industry's lobbying plan is to pay lobby the government to dismantle the FCC's ability to protect consumers, then shovel all remaining oversight to an FTC that's ill-equipped to handle it. The FTC lacks the ability to craft new rules as needed, and is so under-funded and over-extended that policing ISP behavior will fall through the cracks. That's something former FCC boss Tom Wheeler explained earlier this year:

"In the Trump administration, people are talking about stripping regulatory power from the FCC, and essentially taking the agency apart (including moving jurisdiction over internet access to the Federal Trade Commission [FTC]). “Modernizing” the FCC is the lingo being used. What’s your thought about that?

It’s a fraud. The FTC doesn’t have rule-making authority. They’ve got enforcement authority and their enforcement authority is whether or not something is unfair or deceptive. And the FTC has to worry about everything from computer chips to bleach labeling. Of course, carriers want [telecom issues] to get lost in that morass. This was the strategy all along.

So it doesn’t surprise me that the Trump transition team — who were with the American Enterprise Institute and basically longtime supporters of this concept — comes in and says, “Oh, we oughta do away with this.” It makes no sense to get rid of an expert agency and to throw these issues to an agency with no rule-making power that has to compete with everything else that’s going on in the economy, and can only deal with unfair or deceptive practices.

And that's not the end of it. AT&T is currently embroiled in a case against the FTC that could erode the FTC's authority even further. AT&T was sued by the FTC after it lied to consumers about throttling their connections in the hopes of driving them to more expensive plans. If AT&T wins that fight, any company with a common carrier component (which extends to everything from parts of Google's business to oil pipelines) could dodge FTC accountability. The FTC warned last year that should this come to pass, companies could buy unrelated common carrier subsidiaries just to dodge regulatory oversight.

So again, the goal here isn't just for "more reasonable regulatory oversight" or "slightly less regulatory oversight," the goal here is almost zero oversight of one of the most predatory and anti-competitive legacy business sectors in America. Any claim to the contrary is utterly disingenuous. And if you believe that letting Comcast run amok with neither competitive pressure nor regulatory oversight ends well for anyone not financially benefiting from it, you've fallen down a very deep, dark rabbit hole and should take a long hard look at history.

from the highly-selective-empathy dept

If you've been paying attention, the Trump admninistration has been engaged in a frontal assault on everything from net neutrality to media consolidation rules, its legacy-industry-cozy policies driving a new wave of mergermania in telecom and media. As such, few thought the administration would block AT&T's $86 billion acquisition of Time Warner. After all, AT&T wasn't acquiring a direct competitor, and the harms caused by vertical integration -- however real -- haven't been a genuine concern in regulatory telecom oversight from either party for years (see Comcast NBC Universal or Sinclair Tribune).

But then rumors began to emerge that the Trump DOJ was contemplating suing to block AT&T's latest megamerger -- unless it was willing to sell either DirecTV (acquired by AT&T last year) or Turner Broadcasting, owner of CNN. Reports indicate that AT&T refused both options and was primed for a court showdown. This week the DOJ announced it would be giving AT&T what it wanted, and is taking AT&T to court to block the deal on antitrust grounds:

"Makan Delrahim, the department’s top antitrust regulator, said the Justice Department opposed the deal because it would create a communications and media behemoth unrivaled in its ability to reach most American homes with wireless and satellite television services and valuable programming such as CNN and HBO, the home to “Game of Thrones."

"This merger would greatly harm American consumers,” Mr. Delrahim, the assistant attorney general for antitrust, said in a statement. “It would mean higher monthly television bills and fewer of the new, emerging innovative options that consumers are beginning to enjoy."

Consumer advocates have long opposed the merger, arguing that AT&T will use its greater size and leverage to amplify what already is a fairly solid legacy of anti-competitive behavior, including making it harder for streaming companies to gain access to the content (especially HBO) they'll need to compete with AT&T's DirecTV Now service. As such, many consumer groups were quick to applaud the lawsuit. Albeit with the caveat that they weren't entirely sure the Trump DOJ was doing this for quite the reasons it claims:

“It’s refreshing to see the Justice Department doing something about this deal. However, we remain very troubled by President Trump’s threats to punish outlets like CNN that have aired critical coverage of the administration. The Justice Department must demonstrate that Trump’s saber-rattling has nothing to do with this suit. It could start by giving the same level of scrutiny to other mega-deals like Sinclair’s proposed merger with Tribune. But the bottom line is that the public would be best served if this merger is scrapped."

Concerns that the Trump administration is (ab)using the DOJ for petty grievances and cronyism aren't unfounded. A Trump administration official in July told the New York Times that it was pondering using the deal as leverage against the network. And Rupert Murdoch has been pushing Trump to block the deal since at least January, worried that it would pose a greater competitive challenge to his own News Corporation empire. AT&T had rejected at least two Murdoch overtures to buy CNN in the last six months, which is why the DOJ may have wanted AT&T to divest Turner Broadcasting.

"AT&T intends to seek court permission for access to communications between the White House and the Justice Department about the takeover, said the people, who asked not to be named because the deliberations are private...AT&T will also try to get any evidence about whether Rupert Murdoch tried to influence the review, according to one of the people. Murdoch, a Trump confidant, controls 21st Century Fox Inc., the parent of Fox News. The president has praised Fox News’s coverage of his administration."

AT&T's already making it clear that if there is dirty pool at play here, it will help it come out in the wash:

Lawyer for AT&T/TW on Trump or WH interference: On details, he said "they have a way of coming out… probably wont bode well for the government if it does"

All told, this is poised to be one of the uglier legal showdowns in recent antitrust memory. And it's forcing folks aligned against the deal to ask themselves if the ends justify the means, even if cronyism and a frontal assault on the media -- not consumer welfare -- are fueling the court battle.

from the ill-communication dept

As AT&T and Verizon shift their focus from fixed-line broadband to the more sexy world of Millennial advertising (often quite poorly), they've effectively decided to hang up on millions of unwanted DSL users they refuse to upgrade and no longer want. This has often involved imposing relentless rate hikes on service speeds straight out of 2003, or in many cases simply refusing to repair these lines. They've also convinced state after state that if they gut consumer protections keeping these lines intact, better, faster broadband connections will miraculously spring from the sidewalks.

AT&T and Verizon argue that state and federal guidelines on this front are just outdated regulations preventing them from building the next-generation networks of tomorrow. Fiber is more reliable and wireless is more flexible, they argue, making older lines irrelevant. That, however, ignores these companies' refusal to actually fully deploy fiber, the fact that pricey & capped wireless isn't a suitable replacement for unlimited DSL, that these lines were taxpayer subsidized, or that many of these DSL and POTS (plain old telephone service) services are still very much in use by the elderly and under-served.

Again though, if you ask AT&T and Verizon, none of this is a big deal because existing wireless services are perfectly suitable replacement for these fixed-line connections. But as people found out when Verizon refused to upgrade DSL lines in the wake of Hurricane Sandy, that's simply not the case. Wireless is often significantly more expensive, frequently capped (especially in rural areas), and often hard to get in many rural, tree-happy markets. Fifth-gen wireless may someday be a suitable replacement depending on cost, but for rural markets that future is a decade or more away.

So a few years back the FCC under Tom Wheeler crafted a set of fairly basic "functional tests" (pdf) intended to prevent telcos from pulling copper-based phone and broadband service without ensuring there's a comparable replacement. The goal: to ensure that services that rely on traditional DSL and POTS still work, and that competitors that service customers over these lines could still access them. Not too surprisingly, telcos have been lobbying the government to gut this guidance. Also unsurprisingly, current FCC boss Ajit Pai has been quick to help them do just that:

"The Federal Communications Commission will vote Thursday on a plan that, according to Chairman Ajit Pai, will strip away regulations that prevent telcos from upgrading their networks.

But in doing so, the Republican-controlled FCC plans to eliminate a requirement that telcos provide Americans with service at least as good as the old copper networks that provide phone service and DSL Internet. The requirement relates to phone service but has an impact on broadband because the two services use the same networks.

While it should be fairly clear that this is yet another gift to the nation's telecom duopolies, as with its net neutrality, media consolidation, and other recent policy 180s, the FCC is engaging in some tap-dance hyperbole to try and deny this is what they're doing:

The FCC press office has been much different since @AjitPaiFCC took over. When I reported that the FCC is letting carriers turn off copper networks without offering adequate replacements, they were extremely evasive about what they're actually repealing.https://t.co/EvdEEHGL0Ppic.twitter.com/xOEfy4h00m

More concisely, the FCC's existing "functional test" for carriers seeking to abandon DSL networks requires they prove that any replacement service is just as good as the services they're eliminating. Since these carriers know wireless is often more expensive and often unavailable, and really don't want to extend fiber into these areas (despite receiving countless billions to do so) they want those restrictions eliminated. It doesn't matter if these lines were paid by taxpayers and are very much still in use; they're focused on making money in mobile advertising.

To tap dance around these issues, Pai's proposal, misleadingly-titled "Accelerating Wireline Broadband Deployment (pdf)," doesn't technically get rid of the guidance, but weakens it to the point of being effectively useless, as consumer groups like Public Knowledge and the NAACP make clear:

"Under current rules, an incumbent carrier cannot discontinue, reduce, or impair service unless there is a replacement service that is as good as the discontinued service. This is called the Functional Test. The FCC's order will now interpret "service" to include a carrier's tariff. A tariff is a very basic description of what a carrier offers and at what rate. This means the Commission's remaining notice requirements will only apply to basic services, but will not include 911 services, ensure network reliability, or interconnection with devices consumers use such as medical monitors, alarm systems, fax and credit card machines, and equipment for people who are hearing impaired. In some cases, the sound of a dial tone may constitute service under the tariff test and therefore not even trigger a public comment and review."

Again this is all very wonky, but a transition away from these taxpayer-subsidized fixed copper lines without ensuring there are reliable (or frankly any) alternatives will have a profound negative impact on your current cable broadband bill and service, while making it harder for less sexy markets to get quality broadband connections (already a significant problem we seem intent on ignoring). And again, Trump's FCC is pushing a telco wishlist policy they know full well will hurt consumers and the health of the nation's telecom infrastructure, while professing they're doing the exact opposite.

from the cronyism-vs-cronyism dept

Given the Trump administration's rubber stamping of every mono/duopolist desire (killing net neutrality, broadband privacy rules, media consolidation limits), most expected the AT&T Time Warner merger to see approval without much fuss. After all, while the problems caused by vertical integration deals like Comcast NBC Universal are very real, it didn't seem likely that an administration running rough shod over consumer protections would give much of a damn. Especially given that Trump DOJ antitrust boss Makan Delrahim had already been on record stating he saw no problems whatsoever with the deal.

That's why leaked reports that the DOJ was suddenly considering blocking the deal came as such a surprise. Said reports indicated that the DOJ was considering a lawsuit to thwart the deal unless AT&T was willing to divest either CNN-owner Turner broadcasting, or DirecTV -- which AT&T acquired last year.

There are two generally-accepted theories as to what motivated the Trump administration to hamstring the deal, neither of which (unless you're immensely gullible) involve actually caring about the very real negative repercussions the deal will have on telecom/media markets and consumers. One is that the Trump administration is simply getting vindictive revenge against CNN for its critical coverage of the president, a path one Trump administration official said was definitely on the table in a July report in the New York Times:

"White House advisers have discussed a potential point of leverage over their adversary, a senior administration official said: a pending merger between CNN’s parent company, Time Warner, and AT&T. Mr. Trump’s Justice Department will decide whether to approve the merger, and while analysts say there is little to stop the deal from moving forward, the president’s animus toward CNN remains a wild card."

But there's another motivation here for the Trump administration: doing a favor for Rupert Murdoch. Reports have indicated that Murdoch has been pressuring the Trump administration to block the deal since at least January, since the combined company would pose a greater competitive threat to his News Corp. empire. Reports more recently indicate that Murdoch approached AT&T at least twice in the last six months looking to convince AT&T to sell CNN, an idea AT&T isn't interested in. In short, it's very possible that Trump may be using the DOJ to force AT&T to make a deal with Murdoch.

AT&T lawyers clearly smell something fishy here, and the company quickly indicated it will be asking a court for any and all communications between the DOJ and the Trump administration. Not too surprisingly, AT&T's inquiry will focus, in part, on the role Rupert Murdoch is playing in scuttling the deal:

"In the event of a trial over the $85.4 billion deal, AT&T intends to seek court permission for access to communications between the White House and the Justice Department about the takeover, said the people, who asked not to be named because the deliberations are private...AT&T will also try to get any evidence about whether Rupert Murdoch tried to influence the review, according to one of the people. Murdoch, a Trump confidant, controls 21st Century Fox Inc., the parent of Fox News. The president has praised Fox News’s coverage of his administration."

The entire affair is just another indication that 2017 is simply too weird for words. Blocking the deal on antitrust grounds is the right thing to do to protect streaming markets from AT&T's long, documented history of anti-competitive behavior. But is it still the right thing to do if the only real goal is to silence critical media voices while aiding a Trump ally's own business ventures? Pick your poison.